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US elections 2024 - Berlin
Berlin - November 6, 2024: Two guests dress up between two cardboard figures of candidates Kamala Harris (l) and Donald Trump (r) at the US Presidential Election Night 2024 at the Baden-Württemberg State Representation (Carsten Koall/Getty Images)
Indecision 2024

How Goldman Sachs, JPMorgan, Citi, and Bank of America are trading the US election

The expected knee-jerk reactions across asset classes and a view on whatever we see Wednesday in markets will persist.

Luke Kawa

Here’s a summary of how some of the biggest institutions on Wall Street expect markets to react to different US election outcomes across different asset classes, as well as some broader thoughts on what will work, what won’t, and for how long:

The views of John Flood, head of Americas equities sales trading at Goldman Sachs, from an email to clients on Tuesday:

A November 4 note from JPMorgan, drawing on work from their FX and fixed-income strategy teams:

JPMorgan FX/rates US election views
Source: JPMorgan

An October 25 note from Citi’s global-asset allocation team:

Citi market implications of US election
Source: Citi Research

A November 3 note from Bank of America’s equity and quant strategy team:

“We believe a big knee-jerk reaction (2%+) should be faded.”

However, “Interestingly, post-election price momentum typically continues into following weeks. The direction of two-week returns following the day after an election was the same as the direction of the day after the election 100% of the time during the prior seven elections (since 1996) and 79% of the time since 1928.”

Price momentum around the election
Source: Bank of America

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SpaceX gets a wave of bullish ratings from Wall Street analysts

SpaceX received more than a dozen positive analyst calls on Tuesday — including from major Wall Street banks — as they initiate coverage on Elon Musk’s space and AI company.

SpaceX went public on June 12 at a $2.2 trillion valuation, the largest debut in history. While the company hasn’t yet posted a profit, it seems to have convinced Wall Street that it will get there and grow its valuation on the way.

Of the at least 17 analysts that gave a rating on Tuesday, all but one gave it a “buy” or “outperform” rating. MoffettNathanson was "neutral."

The ratings come as SpaceX joined the Nasdaq 100 index, a benchmark tech-heavy basket of companies that underpins millions of portfolios. The inclusion adds built-in demand for the stock from index funds and ETFs.

Still, SpaceX fell more than 5% on Tuesday amid a broader sell-off, and is currently effectively flat from its opening price of $150 a share.

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